Reported after market overnight and there were a few key takeaways, the first being a comment from the MSFT CEO about technology more generally which I think is very relevant: Digital technology is a deflationary force in an inflationary economy. Businesses – small and large – can improve productivity and the affordability of their products and services by building tech intensity” – Satya Nadella, CEO MSFT.
As a recap, MSFT has a market cap greater than $3 trillion, is forecast to grow revenue at 14% through to June 22 supported by acceleration in cloud adoption as people and businesses continue to transition online, with 31% YoY growth. We saw the likes of Office 365 Commercial +23% YoY and LinkedIn +42% YoY with marketing solutions growth of 61% YoY, however there was strength right across the board. This is simply a dominate business engrained in our everyday lives and that won’t change. It has ~$100Bn in net cash and trades on 34x earnings which given 1. Dominance 2. Predictability of earnings & 3 Growth is not that expensive. MSFT has been in our International Equities Portfolio for ~18 months, we’ve almost doubled our money however we expect to hold this stock well into the future.
MM remains bullish MSFT
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